PROBLEM 4-1B (Continued)
(b) PEVNICK INC.
Income Statement
For the Quarter Ended March 31, 2015
Revenues
Service revenue……………………………………….. $15,650
Expenses
Salaries and wages expense …………………….. $2,200
Travel expense ………………………………………… 1,300
Rent expense …………………………………………… 1,200
PEVNICK INC.
Retained Earnings Statement
For the Quarter Ended March 31, 2015
Retained Earnings, January 1 ………………………….. $ 0
Less: Dividends …………………………………………….. 600
PROBLEM 4-1B (Continued)
PEVNICK INC.
Balance Sheet
March 31, 2015
Assets
Current assets
Cash ……………………………………………………… $11,400
Accounts receivable ………………………………. 7,650
Supplies ………………………………………………… 280
Prepaid insurance ………………………………….. 1,800
Liabilities and Stockholders’ Equity
Current liabilities
Notes payable ………………………………………… $10,000
Accounts payable …………………………………… 12,350
(c) Mar. 31 Supplies Expense ………………………….. 770
31 Depreciation Expense ……………………. 800
Accumulated Depreciation—
31 Interest Expense ……………………………. 300
31 Insurance Expense ………………………… 600
PROBLEM 4-1B (Continued)
Mar. 31 Accounts Receivable …………………………. 2,030
(d) Mar. 31 Service Revenue ………………………………… 15,650
31 Income Summary ……………………………….. 7,370
Travel Expense………………………….... 1,300
Salaries and Wages Expense ……….. 2,200
Rent Expense …………………………..…. 1,200
31 Income Summary ……………………………….. 8,280
31 Retained Earnings ……………………………… 600
PROBLEM 4-2B
(a) GREENWOOD COMPANY
Partial Worksheet
For the Year Ended December 31, 2015
Account
Adjusted
Trial Balance
Income
Statement
Balance
Sheet
No.
Titles
Dr.
Cr.
Dr.
Cr.
Dr.
Cr.
101
Cash
18,800
18,800
112
Accounts Receivable
16,200
16,200
126
Supplies
2,300
2,300
130
Prepaid Insurance
4,400
4,400
157
Equipment
46,000
46,000
158
Acc. Depr.—Equip.
20,000
20,000
200
Notes Payable
20,000
20,000
201
Accounts Payable
8,000
8,000
212
Salaries and Wages
Payable
2,600
2,600
230
Interest Payable
1,000
1,000
311
Common Stock
15,000
15,000
320
Retained earnings
11,000
11,000
332
Dividends
12,000
12,000
400
Service Revenue
87,800
87,800
610
Advertising Expense
10,000
10,000
631
Supplies Expense
3,700
3,700
711
Depreciation Expense
8,000
8,000
722
Insurance Expense
4,000
4,000
726
Salaries and Wages
Expense
39,000
39,000
905
Interest Expense
1,000
1,000
Totals
165,400
165,400
65,700
87,800
99,700
77,600
Net Income
22,100
22,100
Totals
87,800
87,800
99,700
99,700
PROBLEM 4-2B (Continued)
(b) GREENWOOD COMPANY
Income Statement
For the Year Ended December 31, 2015
Revenues
Service revenue……………………………………… $87,800
Expenses
Salaries and wages expense …………………… $39,000
Advertising expense ………………………………. 10,000
Depreciation expense …………………………….. 8,000
GREENWOOD COMPANY
Retained Earnings Statement
For the Year Ended December 31, 2015
Retained Earnings, January 1 …………………………..……………. $11,000
Less: Dividends …………………………………………………………… 12,000
PROBLEM 4-2B (Continued)
GREENWOOD COMPANY
Balance Sheet
December 31, 2015
Assets
Current assets
Cash ……………………………………………………… $18,800
Accounts receivable ………………………………. 16,200
Supplies ………………………………………………… 2,300
Prepaid insurance ………………………………….. 4,400
Liabilities and Stockholders’ Equity
Current liabilities
Notes payable ………………………………………… $5,000
Accounts payable …………………………………… 8,000
Salaries and wages payable ……………………. 2,600
Interest payable ……………………………………… 1,000
PROBLEM 4-2B (Continued)
(c)
General Journal J14
Date
Account Titles and Explanation
Ref.
Debit
Credit
Dec. 31
Service Revenue …………………………...
400
87,800
Income Summary …………………..
350
87,800
31
Income Summary …………………………..
350
65,700
Advertising Expense ………………
610
10,000
Supplies Expense ………………….
631
3,700
Depreciation Expense …………….
711
8,000
Insurance Expense ………………..
722
4,000
Salaries and Wages Expense ….
726
39,000
Interest Expense ……………………
905
1,000
31
Income Summary …………………………..
350
22,100
Retained Earnings………………….
320
22,100
31
Retained Earnings ………………………….
320
12,000
Dividends ………………………………
332
12,000
(d)
Retained Earnings No. 320
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 31
Balance
11,000
11,000
Dec. 31
Closing entry
J14
22,100
33,100
31
Closing entry
J14
12,000
21,100
Dividends No. 332
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
12,000
12,000
31
Closing entry
J14
12,000
0
PROBLEM 4-2B (Continued)
Income Summary No. 350
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Closing entry
J14
87,800
87,800
31
Closing entry
J14
65,700
22,100
31
Closing entry
J14
22,100
0
Service Revenue No. 400
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
87,800
87,800
31
Closing entry
J14
87,800
0
Advertising Expense No. 610
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
10,000
10,000
31
Closing entry
J14
10,000
0
Supplies Expense No. 631
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
3,700
3,700
31
Closing entry
J14
3,700
0
Depreciation Expense No. 711
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
8,000
8,000
31
Closing entry
J14
8,000
0
Insurance Expense No. 722
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
4,000
4,000
31
Closing entry
J14
4,000
0
PROBLEM 4-2B (Continued)
Salaries and Wages Expense No. 726
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
39,000
39,000
31
Closing entry
J14
39,000
0
Interest Expense No. 905
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
Balance
1,000
1,000
31
Closing entry
J14
1,000
0
(e) GREENWOOD COMPANY
Post-Closing Trial Balance
December 31, 2015
Debit
Credit
Cash …………………………………………………………… $18,800
Accounts Receivable …………………………..………. 16,200
Supplies …………………………………………………….. 2,300
Prepaid Insurance ……………………………………….. 4,400
Equipment ………………………………………………….. 46,000
PROBLEM 4-3B
(a) NIHO COMPANY
Income Statement
For the Year Ended December 31, 2015
Revenues
Service revenue …………………………………… $45,000
Expenses
Salaries and wages expense ………………… $35,200
Maintenance and repairs expense ………… 4,400
NIHO COMPANY
Retained Earnings Statement
For the Year Ended December 31, 2015
Retained Earnings, January 1 ……………………… $14,000
Less: Net loss …………………………………………… $2,600
NIHO COMPANY
Balance Sheet
December 31, 2015
Assets
Current assets
Cash …………………………………………………… $5,200
Accounts receivable ……………………………. 7,500
Prepaid insurance ……………………………….. 1,800